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As the ecommerce trend continues in Southeast Asia, a wave of the new generation of moms is joining the party. These moms are relying more and more on online to help them embrace their role as a parent.

Millennial moms expressed their dependency on online for their shopping journey, especially for the Mom & Baby category, during an ecommerceIQ panel session in Jakarta earlier this month.

ecommerceIQ surveyed 1,144 Indonesian moms with results showing that 66% have attempted to purchase Mom & Baby products online. Shopee was voted as the most popular e-marketplace for this category, followed by Lazada and Tokopedia.

Mom & Baby Indonesia Online Shoppers

aCommerce Group CMO Sheji Ho on stage presenting the findings from ecommerceIQ’s report: Digital Profile Mom & Baby Shoppers in Indonesia.

Indonesian actress and Miss Universe 2007 finalist Agni Pratishta was one of the panelists at the event. She agreed with the findings and also mentioned that most women visit numerous websites to find the best deals.

“I have a group chat with other moms where we exchange information regarding which e-marketplace is having a sale right now,” admitted Agni.

Agni was joined in the panel session with the Head of Marketing Baby Care from Softex Indonesia, Wenny Damayanti, and aCommerce Group CMO Sheji Ho to shed light on the current landscape comprising Mom & Baby online shoppers in Indonesia.

What else did we discover from the event?

Panel session during ecommerceIQ event in Jakarta with Agni Pratistha (middle) and Wenny Damayanti (right).

Indonesian moms shop cautiously online

When Indonesian moms were asked about their favorite online shopping platforms, brand websites did not feature much in their answers, with only Mothercare Indonesia appearing on the radar at a score of 4%.

Digging deeper, the result is most likely related to the type of products they are more likely to buy online in this category. Following general ecommerce trends in the country, Baby Clothing (49%) ranked as the most popular product purchased online in this category, followed by Baby Gear (23%) and Toys (18%).

Mom & Baby Indonesia Online Shoppers

Top products purchased online in Mom & Baby category in Indonesia; ecommerceIQ Mom & Baby Customer Survey in Indonesia (2018)

Meanwhile, perishable goods like Baby Personal Care and Baby Food are less popular and the cause of it is rooted in the main reasons why Indonesian moms don’t shop for this category online.

Mom & Baby Indonesia Online Shoppers

Top reasons for consumers to not shop for Mom & Baby products online; ecommerceIQ Mom & Baby Customer Survey in Indonesia (2018)

More conviction is necessary for consumers to purchase perishable goods online; moms require full assurance of product quality, and one way to avoid buying counterfeit products in the e-marketplace is to purchase only from brands’ official online flagship stores.

The top three consumer-favorite platforms all benefit from their official brand-dedicated portal inside their platform.

Mom & Baby Indonesia Online Shoppers

Tokopedia’s dedicated page for brands’ official store; Tokopedia

The importance of word-of-mouth in the digital world

Brands should always take cues from its consumers to adjust and hone their retail strategy. These include instilling customer confidence to overcome the reservations mentioned above. Wenny revealed that internet habits of millennial mothers provided the driving force for Sweety’s shift to digital.

“These moms are constantly searching for information online. TV commercials alone are no longer sufficient. Modern day moms use the internet to talk to their friends, surf for product information and read customer reviews before deciding which products to buy. Sweety took these cues onboard and redefined its online strategy,” explained Wenny.

Sweety’s official flagship store is offering online exclusive offer on ShopeeMall Indonesia.

Product reviews are a key aspect for Indonesian moms to overcome the wariness of doing their shopping online, as seconded by Agni

“Reviews are the make or break point for me when I shop online. When I see a product in e-marketplace with no review, even if the price is right, I wouldn’t risk buying it most of the time.”

Unfortunately, leaving a product review is not a habit mastered by Southeast Asian consumers yet, especially compared to consumers in developed ecommerce market like the US. And most of the time, Southeast Asians are prone to leave only bad reviews as a way to express their dissatisfaction and to caution other consumers.

Brands must concentrate on encouraging satisfied consumers to be more proactive and do the same. Some brands have utilized user-generated content platforms like ReviewIQ to help with the problem. Nivea, for example, achieved an increase in the number of positive reviews with the help of ReviewIQ from real consumers for its flagship store on Lazada Thailand.

“At this stage, brands still need to incentivize satisfied consumers to help generate good, organic reviews,” says Sheji.

How should Mom & Baby brands go about online?

Sheji stresses the importance of brands understanding the nature of their products and their primary objective to determine the optimal online strategy.

“If your products fall into the luxury category, you might as well sell it on your brand website to retain the full control of your channel. However, this strategy requires you to invest extensively in bringing in traffic,” advised Sheji.

But having a website also means owning a proprietary media channel that can be used for marketing and educational purposes. Brands like Sweety and Frisian Flag, for example, use their sites to connect offline promotion with the online audience as well as equip consumers with detailed product information.

For most brands, however, if the objective is to diversify sales channels, then opening an official flagship store on an e-marketplace like Shopee or Lazada is sufficient and also easier to maintain, while providing access to a broader online consumer base.

Drawing on her extensive experience in promoting Sweety to e-marketplaces, Wenny opined that prioritizing e-marketplace sales avenues is paramount for success. Especially in Indonesia where consumers are presented with many options, and competition between e-marketplaces is high, brands often feel the needs to have ubiquitous footprints.

Wenny summed up, “Choosing the right e-marketplace is an important step in the online expansion. Selection must consider the available audience, while also ensuring that the e-marketplace’s infrastructure is compatible with the business.”

Get the full report of Digital Mom & Baby Shoppers Profile here.

As the fastest growing industry in one of the world’s fastest growing markets, the evolution of Southeast Asia’s ecommerce landscape means new players and a lot of consolidation since last year’s first ECOMScape series by ecommerceIQ.

This year’s new edition of the ECOMScapes kicks off with Indonesia.

Expected to capture the biggest chunk of the $200 billion ecommerce opportunity in Southeast Asia, it’s easy to see why Chinese giants like Alibaba, JD, and Tencent have rigorously left their home-market to tackle Indonesia. What has happened over a span of only one year?

1. Chinese Companies are Hungry

Out of the total $3 billion investment put into Indonesia startups in the first eight months of 2017, 94% of the funding came from Chinese investors.

News regarding Alibaba leading a $1.1 billion investment in Tokopedia created excitement in the industry, especially because JD was rumored to also make a bid for the popular local marketplace.

Indonesia startups investment

Although that opportunity passed, it hasn’t stopped JD from participating in the funding round of Indonesia’s two other unicorns, ride-hailing app Go-Jek and online travel booking platform Traveloka. Chinese giant Tencent also joined the round for Go-Jek.

2. Natural Selection: A Race to the Bottom

As the market in Indonesia saturates, in both players and investment, it’s only a matter of time before natural selection weeds out the weaker companies (especially those with shallow pockets).

The past year has seen several ecommerce companies in Indonesia either shutting down or pivoting business models, and investors pulling out before stakes become worthless. And don’t think it’s only happening to the small fish.

Some cases? Alfacart and Elevenia.

Earlier this year, Indonesian convenience store chain Alfacart announced its decision to ditch the marketplace model after a continual lag behind e-marketplaces like Lazada and MatahariMall.

Launched in 2013, Elevenia is the joint venture of telco companies XL Axiata and Korea’s SK Planet. Despite claims that Elevenia has seen positive growth over the years, it’s a telling sign when both companies pull out and sell their stake to Indonesia’s conglomerate group Salim.

Even the ecommerce arm of large telco company Indosat, Cipika, shut down in June citing unprofitable business model and high cash burn rate as reasons.

Indonesia ecommerce landscape

With JD and Alibaba investing directly in local companies, it’s not a stretch to expect fewer names on the ECOMScape next year.

3. Marketplace Competition Heats Up

If this time last year Tokopedia was focused on growing its core C2C business, the Indonesian marketplace has long since been strong arming its shift to B2C as signaled by Unilever’s official store opening on the platform.

The move is already serious competition to Lazada, especially as the two ecommerce companies interchangeably grab the top spot in web traffic in Indonesia (which is probably why Alibaba invested in both companies).

Indonesia’s top C2C players have been moving into the B2C space i.e. Tokopedia. Traffic of ecommerce websites compiled by ecommerceIQ. Find more here.

Sea’s backed Shopee has also opened its platform for brands as it launched Shopee Mall that claimed to offer over 500 brands.

The shift from C2C to B2C is a natural progression as companies attempt to increase revenue and leverage their already large customer bases.

4. Having Fintech is for “Cool Kids” But the Nerds Will Win

While payments still remain a pain point in Indonesia ecommerce even though multiple companies released their own e-wallets last year, the country and the region potentially, might finally have a real solution.

Both Kudo and Kioson are arming micro-entrepreneurs and business owners such as mom-and-pop shops in rural areas with their digital platform to empower them to act as the bridge between ecommerce companies and rural citizens.

The O2O (online-to-offline) concept clearly has some merit, as both companies attracted investor attention and made headlines in 2017. Kudo was acquired by Grab and Kioson raised $3.3 million as the first tech company to IPO on the Indonesia Stock Exchange (IDX).

Kioson during its IPO in October 5, raising $3.3 million. Source: Kioson.

Indonesian startup darling Go-Jek is also leveraging its millions of users by launching its own mobile wallet, GoPay, which has real potential to become the WeChat of Indonesia.

GoPay’s usability has improved from payment for rides to also allowing peer-to-peer (P2P) transfers and making the order of food, groceries, tickets, and beauty treatments extremely easy in one app.


Are we missing any key players? Let us know via Linkedin | Facebook | Twitter

Download ECOMScape Indonesia 2017 here.

Featured image credit: Martha Suherman

With the boom of technology in the region, Southeast Asia has become home to young startups, and investors hoping to help fuel its rapid growth.

Some examples of investment news surrounding the region only this year include Chinese ecommerce giant JD.com confirming a $500 million joint venture with Thai retailer Central to build up the ecommerce and fintech sector in Thailand; Malaysia Debt Ventures set aside a $238 million fund to target technology-based companies like AR, VR, etc; and 500 Startups has made its debut investment in Myanmar backing a social media monitoring and news discovery app.

A recent report commissioned by Google and AT Kearney also highlights just how much money has been funneled into the region, which market is the most attractive and where are the most deep-pocketed investors coming from.

Southeast Asia’s golden child

Although the investment for startup companies in Southeast Asia only contributed to 8% to the total $90 billion of investment into Asia, this value has grown 23 times from 2012 to 2016 from $0.3 billion to $6.8 billion.

Most of the money has been pumped into Singapore and Indonesia that captured 60% of the entire investment.

Indonesia startups investment

Singapore gained most of the startup investment in Southeast Asia

However, nothing shone brighter this year than the myriad of Indonesian startups that have been stealing the attention of global industry giants like Tencent, Expedia, and Tim Draper from Draper Associates who invested in the early days of Tesla, Baidu, and Skype.

The country has produced three startups that classify as a ‘unicorn’, a company valued at more than $1 billion. They are Traveloka, Tokopedia and Go-Jek.

The first is valued at $2 billion after a $350 million investment from Expedia in July, and both Tokopedia and Go-Jek also are worth around $1 billion and $3 billion respectively.

Where’s all the money coming from?

Attracting the Chinese investors

In a short span of four years time from 2012 to 2016, Indonesia has seen 31 times growth of investment value from $44 million to $1.4 billion. During 8 months in this year alone, this value has grown more than two times to $3 billion driven by later-stage investments.

Indonesia startups investment

The staggering growth has AT Kearney predicting the ecosystem could attract more investment than the oil and gas industry — which contributed $23.7 billion or 3.3% of the country’s GDP last year.

“Due to the massive growth, the value of startup investments in Indonesia may surpass the nation’s oil and gas investment which was $5 billion in 2016,” said AT Kearney partner, Alessandro Gazzini.

From all of the investment raised by Indonesian startups since 2012, ecommerce received the biggest chunk of gold taking 58% of the total investment value.

Transport and fintech quickly follow behind with 38% and 2% respectively.

Indonesia startups investment

Indonesia has also become a hotbed for the expansion of Chinese companies as the country sees a growing interest from Chinese investors this year.

94% of the startups investment in the country during 2017 have involved Chinese investors, up from only 2% last year. Two of the infamous Chinese BAT, Alibaba and Tencent, are raising stake in Indonesia by investing in Tokopedia and Go-Jek respectively.

Meanwhile, JD.com diversified its portfolios with investment in Traveloka making Indonesia the official battleground for Chinese companies to fight their proxy war.

Indonesia startups investment

The involvement of Chinese investors in Indonesia is something that the government has encouraged across all sectors. Indonesia’s Investment Coordinating has even set up a special China desk to attract more investors.

With the country still at a nascent digital stage, there is no precise measurement to find out the country’s true potential until company’s try but as the famed venture capitalist Tim Draper said about Indonesia, “it is a great place to be”.

Here’s what you should know today:

1. Tokopedia confirms $1.1B investment led by Alibaba

After months of fundraising rumors, Tokopedia confirms on its 8th anniversary yesterday that it has closed a $1.1 billion financial round.

Chinese ecommerce giant’s Alibaba led the investment and became the minor shareholder in Tokopedia. Both of the companies count Softbank as their mutual investors.

Before this deal is closed, Alibaba’s rival in China JD.com was also reportedly courting Tokopedia, but since then has shifted its focus to the niche players.

Read the full story here

2. Alibaba’s stock up over 81% this year

Alibaba beats analyst’s estimates with a 56% percent rise in its Q1 revenue, driven by growth in online sales.

86% of total revenue in Alibaba is made up from ecommerce business, up from 73% in the same period last year. The company is benefitting from the growing online shopping behaviors.

Alibaba raised its expectations for full year revenue growth to 45-49% as it has accelerated its ecommerce infrastructure in Southeast Asia, including investment in Lazada and recently Tokopedia.

Read the full story here.

3. Indonesia’s Laku6 in talks for $3M series A

Jakarta-based ecommerce for used-phone Laku6 is reportedly in discussions to raise up to $3 million by the beginning of Q4.

Laku6 has secured over $1.8 million in seed funding from Golden Gate Ventures (GGV) with participation from Kejora, Convergence Ventures, SkyStar Capita, and Rocket Internet.

The company is banking big on a new offering and expects to triple its revenue by the end of the year and claimed to have sold more than 20,000 units until now

Read the full story here.

 

Here’s what you should know today:

1. President of Indonesia signed the ecommerce road map

President Joko “Jokowi” Widodo has signed the long-awaited ecommerce road map that was expected to be issued at the end of this year

The road map will provide guidelines for the country’s digital economy sector, including issues such as payment, logistics, cyber securities, taxation, human resources development and consumer protection.

The ministry was also designing a measure to record online transaction information from the marketplace, in coordination with the Finance Ministry, Central Statistics Agency (BPS) and Bank Indonesia.

Read the full story here.

2. Facebook enters China with photo sharing app

Facebook is testing a photo-sharing app called Colorful Balloons in China after banned in the country since 2009.

Colorful Balloons works like Facebook’s Moments app by allowing users to share photos with friends and family members.

However, instead of using Facebook’s interface, it relies on WeChat, and was released by a local company called Youge Internet Technology.

Read the full story here.

3. Indonesia’s niche ecommerce players attract JD.com 

Chinese internet giant JD.com continues to show its interest in the market by pursuing new partnership with niche ecommerce players in Indonesia. The company is also said to be open to making an equity investment.

JD.com is learnt to be interested in partnering with Laku6 although that relationship may not be an equity based one. The firm aslo recently participated in Traveloka’s $500 million funding round.

The rumour of its talks for investment in Tokopedia has been around for months with its rival Alibaba also showing interest in closing the deal.

Read the full story here.

Here’s what you should know:

1. JD.com rumoured to acquire Tokopedia

Alibaba’s biggest rival JD.com is rumoured to have acquired majority stake in Tokopedia.

If the rumour is true, Tokopedia will be another Indonesian startup that reach unicorn status after Go-Jek and Traveloka – which has just received $350M investment from Expedia.

The rumour about Chinese ecommerce giants’ interests in one of Indonesia’s biggest ecommerce site has been surfacing for months. Last month, Alibaba is the one that reportedly in talks to invest $500 million in Tokopedia.

Read the full story here

2. Online marketplace Pinkoi launched in Thailand

Taiwan-headquartered online marketplace Pinkoi is officially launched in Thailand. Pinkoi is a cross-border curated marketplace for original design products.

Inspired by the weekend market, Pinkoi seeks out niche designers throughout Asia to appeals to specific demographics. Pinkoi support the designers through workshops covering various topics related to ecommerce.

The marketplace is focussed on China, Hong Kong, Japan, the US, and now Thailand. But it has presence in 88 countries with 1.6 million members.

Read the full story here.

3. Sinar Mas Land and Samsung to host Indonesia Next Apps 4.0

Sinar Mas Land and Samsung will collaborate to host Indonesia Next Apps 4.0, an app-creating competition across eight cities in Indonesia.

Sinar Mas Land is challenging participants to create apps that will be useful in the field of transportation, marketing, and community.

The eight cities where the competition will be held are: Jakarta, Medan, Bandung, Semarang, Yogyakarta, Surabaya, Malang and Makassar. A road show in these cities is expected to draw more participants.

Read the full story here